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Colleges in Northeast Face Grimmer Future, Analysis Predicts

Declining state appropriations, unstable endowment returns, a projected drop in the number of high-school graduates—there’s no shortage of grim news for higher education of late. But a new analysis from the State University of New York at Albany’s Nelson A. Rockefeller Institute of Government says institutions in the Northeast may be hit harder than the rest.

In a report released on Wednesday, Jason E. Lane, the institute’s director of education studies, argues that data show this gloomy scenario could lead to more closures and consolidations of higher-education institutions in the region.

Mr. Lane based his analysis on data in a recent report from Moody’s Investors Service, which suggested that the negative outlook for higher education is worse than previously thought, and a recent report from the Western Interstate Commission for Higher Education. The commission’s report says the number of high-school graduates, particularly in the Northeast, will sharply decline over the next two decades. (The report defines the Northeast as Connecticut, Maine, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, and Vermont.)

From 2009 to 2028, the number of graduates in the region is expected to decline by 10 percent, meaning 65,000 fewer students will be heading to higher education, according to the report. By the end of the current decade, institutions that do not adapt to such changes could face closure or consolidation, Mr. Lane says.

“Many higher-education institutions are bound to lose enrollments unless more significant attention is paid to nontraditional students or recruiting students from outside of the region,” Mr. Lane says in the analysis.

Mr. Lane also looked at endowment-return data from the Commonfund Institute and the National Association of College and University Business Officers, and the annual Grapevine report on state support for higher education.

Because of the volatile nature of endowment returns and cuts in state spending on higher education, Mr. Lane writes, institutions should look elsewhere for more-creative solutions by reaching further into the out-of-state student market and seeking partnerships in the community.

The governors of Massachusetts and Connecticut, for example, are attempting to issue state bonds to invest in science, technology, engineering, and mathematics facilities and instruction.

Mr. Lane says in his analysis that finding creative ways to adapt to demographic and economic changes will be essential to avoid closure or consolidation.

“Those that survive,” he says, “will be the ones that learn to adapt to the new conditions.”